Whatever Happened To Cabinet Health After Shark Tank?
Sustainability is becoming increasingly relevant discussion point within our everyday lives, from which car we drive to where we get our clothes. Entrepreneurs and close friends Russell Gong and Achal Patel saw their own way to encourage people to live a more environmentally friendly lifestyle with their sustainable medicine company Cabinet Health.
Cabinet Health's mission is to lessen the devastating impact that plastic medicine bottles are having on the environment. With 190 billion of these bottles being made each year and only upwards of 7% being recycled, much of the wasted microplastics make their way into our bodies. It was clear to the team that there was a massive problem at hand and Cabinet Health offered the solution. Users can order their medication through the company's online service and have their pills sent to them through a compostable pouch. The pills can then be stored in Cabinet Health's safe, reusable glass container.
Gong and Patel each combined their backgrounds to help start the business. Patel grew up in the medicine and healthcare industry, with his grandfather opening one of the first acetaminophen factories in the 1960s, and continued on with a rich career in healthcare strategizing and consulting. Gong specializes in building sustainable products and building brands, having worked for years aiding in the creation of environmental policies for state and federal legislatures.
By the time they appeared on "Shark Tank," the company had struck success, with over 700,00 customers and millions raised from previous investors. But with the help of a shark, they hoped to weed out some notable setbacks.
What happened to Cabinet Health on Shark Tank?
Season 14 of "Shark Tank" saw entrepreneurs Russell Gong and Achal Patel seek out a jaw-dropping investment of $500,000 for a 2.5% equity stake in Cabinet Health. The two will need to fight a good fight to justify the gargantuan valuation of $20 million.
They manage to wow the sharks with their presentation. On top of the environmental effort that the company is pursuing, they provide more pills per package and cost less than brand name over the counter medication. They are on track to hit $14 million in sales by the end of 2022, but there is snag in the road halting them from profitability. While they are profitable on a per unit basis, the cost put into research and development has been keeping them in the negative. Mark Cuban calls "BS" on the R&D need since they are not inventing any medication. The team clarifies that the packaging must receive stability approval from the FDA before being put on the market.
From there, the sharks share their opinions. Barbara Corcoran thinks it will take too long to get her money back, Lori Greiner hates the valuation, and Mark Cuban is generally wary of the company. Kevin O'Leary and Doordash CEO Tony Xu make their own offers, but the entrepreneurs ask if they'd be willing to go in together on a royalty deal. The sharks will put in the $500,000 with each getting 3.5% equity along with 2% in royalties until they double their investment, to which they agree.
Thanks to their proven success and wholehearted mission, Gong and Patel's business managed to nab two sharks. So, what was the aftermath of this achievement?
Cabinet Health after Shark Tank
It seemed that Cabinet Health's urgent mission to build a sustainable world for the medicine industry resonated with more people than the sharks. Following the airing of their "Shark Tank" episode, Achal Patel and Russell Gong had various school groups, medical experts, and environmental specialists get in touch with them to find ways of contributing to their goals. This was very much in line with what the team hoped to get out of their "Shark Tank" experience, with Gong saying in an interview with MIT, "We decided to focus on our research, our logic, and our reasons for why people should care about this and that can translate to any pitch—not just Shark Tank. If you have that, nothing can go wrong that you can't be proud of."
Investors Kevin O'Leary and Tony Xu also weren't hesitant in promoting all that Cabinet Health stood for. The two featured on an Instagram video, where they shared a bit about the deal and the good work being put in by the company. "Two awesome founders, an amazing mission, and a differentiated product," Xu says in the video. "It's going to be a huge success and I couldn't be more excited." It was clear that Cabinet Health was heading in the right direction, so did they reach their desired destination?
Is Cabinet Health still in business?
When they appeared on "Shark Tank," Cabinet Health founders Russell Gong and Achal Patel claimed that the company would reach profitability by October 2023, with Patel recently stating in a Morning Brew interview that the company hopes to hit $20 million by year's end. As of July, they have already made some impressive strides to reach those goals.
For much of the year, they worked with 100 customers in testing a new service that would allow them to include prescription drugs. It seems that the service is now fully functioning. Customers can find the company online through their official website. Here, they sell a variety of over the counter medication ranging from allergy relief to digestive help and much more along their newly implemented prescription services. Additionally, Cabinet Health recently became available in over 700 CVS locations across the country. They also continue to make appearances at events, including several pop ups and a recent appearance at the annual McKesson IdeaShare conference.
It may still take some time before we find out how well Cabinet Health's efforts have helped them in the long run, but there's no doubt that they are on the right path. But above all else, the company's creators are determined to keep the integrity of their mission intact.
What's next for Cabinet Health?
Cabinet Health has experienced some fast growth since their time on "Shark Tank," becoming highly regarded throughout the medical industry and even ranking at #78 on the list of the 169 fastest growing companies in the Northeast by Inc. But that barely scratches the surface of what creators Russell Gong and Achal Patel aim to accomplish in their efforts to create an environmentally conscious healthcare world.
In an interview with Green Matters, Gong shares how Cabinet Health plans to continue giving back to further sustainability efforts. "The forever goal of Cabinet is that we use the portion of [over-the-counter medicine] sales to continue ongoing investments in furthering sustainable health care," he says. "So all of our OTC sales, a percentage of that goes back into additional green initiatives." But that's not all. Gong also explains that the company hopes to expand their mission to other corners of the medical industry, hoping to find manners of reducing waste with nitrile gloves, surgical gowns, masks, and more.
It's clear that the Cabinet Health team have some lofty goals to hit. But if their determination and current success rate is anything to go off of, the healthcare world is in for a massive change for the better.